Butler Snow is pleased to announce that two of the firm’s attorneys, David M. Cohen and Stanford G. Ladner, have been recognized as 2017 New York Metro Super Lawyers. Cohen has been honored in the personal injury – products: defense practice area and Ladner has been honored in the government finance practice area.

The Consumer Financial Protection Bureau has modified Equal Credit Opportunity Act regulations to provide additional flexibility for mortgage lenders in the collection of consumer ethnicity and race information. The amendments aim to clarify for mortgage lenders their obligations under the law.

The bureau also is seeking comments on a proposed policy guidance describing the Home Mortgage Disclosure Act data it proposes to make available to the public beginning in 2019, including modifications to protect consumers’ privacy.

The National Association of Realtors and the nonprofit American Student Assistance released a joint study on millennial student loan debt, finding that an overwhelming majority of millennials with student debt currently do not own a home and believe this debt is to blame for what they typically expect to be a seven-year delay from buying.

Only 20 percent of millennial respondents currently own a home, and they are typically carrying a student debt load that surpasses their annual income.

Find out what Chief Economist Lawrence Yun had to say about these findings and what it means for the broader housing market.

In response to questions from members regarding the means of delivery and timing requirements for the Loan Estimate and Closing Disclosure forms under the TILA-RESPA Integrated Disclosure rule, the Credit Union National Association has issued a post detailing its answers.

The Department of Housing and Urban Development has published a request for public comment in the Federal Register, seeking comments regarding possible revisions to the department’s Form HUD-9900, the application to become an approved Housing Counseling Agency.

HUD’s Housing Counseling Program educates families and individuals on how to improve their housing situation and avoid predatory lending practices, among other things.

Find out more about the program and the department’s specific questions for the public.

On Sept. 20, the Federal Reserve issued the Federal Open Market Committee’s statement. The committee indicated that the Fed likely will continue to incrementally raise the federal funds rate and that it will begin winding down its $4.5 trillion mortgage-backed asset purchase program.

A shareholder class action lawsuit has been filed against Zillow and its CEO and chief financial officer, alleging that misleading statements regarding its co-marketing platform harmed its shareholders.

The U.S. District Court for the District of Minnesota held in Consumer Financial Protection Bureau v. TCF National Bank (Civ. No. 17-166) that the bureau could not penalize the company for acts committed in 2009, two years before the CFPB was founded.

The bank also argued that the bureau failed to allege plausible claims under the Consumer Financial Protection Act.

Find out why the bank’s reliance on previous guidance from the Federal Reserve was not the reason for this decision.

The Consumer Financial Protection Bureau has issued a no-action letter to Upstart Network, Inc., a company that uses alternative data in making credit and pricing decisions. As a condition of the letter, Upstart regularly will report lending and compliance information to the bureau to mitigate risk to consumers.

The goal of the CFPB’s no-action letter program is to facilitate consumer-friendly innovations where regulatory uncertainty may exist for certain emerging products or services.

The Senate confirmed President Donald Trump’s nominee for deputy secretary of the Department of Housing and Urban Development. Pam Patenaude, who previously served at the department under former President George W. Bush, detailed her housing work within her testimony.

Patenaude played an instrumental role in the development of HUD’s five-year Strategic Plan and she detailed her work regarding disaster relief efforts in her time at HUD in her testimony.

Find out more about her experience, and how the Mortgage Bankers Association and the National Association of Realtors responded to the confirmation.

Altisource Portfolio Solutions S.A. has released the results of its inaugural Default Servicing Survey, finding that that 97 percent of servicing professionals surveyed indicated they will consider a single-vendor approach to support complex portfolio needs.

According to the U.S. Department for Housing and Urban Development, FHA loans accounted for more than 17 percent of newly originated mortgages in 2016 and constituted 35 percent of all loans delinquent for 30 or more days.

Read on for more details on what servicing professionals consider the greatest challenges for effective claims without conveyance of title programs.

While appearing before the Senate Finance Committee, Iona Harrison, chair of the National Association of Realtors’ (NAR) Federal Taxation Committee, warned against misguided tax reforms that can pose significant threats to the economy.

At the hearing, titled “Individual Tax Reform,” Harrison told senators that putting homeownership in the crosshairs of tax reform would strike at millions of American households.

Read on for more details from Harrison’s appearance before the Senate committee.

Butler Snow is pleased to announce that several of its attorneys, along with Yamaha’s in-house counsel, have been selected for the Yancey Memorial Award by the International Association of Defense Counsel. The award is given to acknowledge excellence in academic writing.

The Consumer Financial Protection Bureau has released its 16th edition of Supervisory Highlights, detailing the findings from the supervision team’s first round of mortgage origination compliance under the TILA-RESPA Integrated Disclosure.

The bureau provided a list of violations regarding the Loan Estimates and Closing Disclosures, including failures to provide consumers with a list identifying at least one available settlement service provider, if the creditor permits the consumer to shop for a settlement service, among other violations.

PHH Corp. and several of its affiliates have proposed a $17 million settlement to resolve allegations that the company violated RESPA Section 8(a) by engaging in a kickback scheme for referrals of title insurance and other settlement services to TRG Services Escrow, Inc. and its affiliates.

It had also been alleged that operated PHH Home Loans as an improper affiliated business arrangement (AfBA).

The plaintiffs in the case requested that the U.S. district court preliminarily approve the settlement so members of the proposed class can receive notice about the action. Read on for more details.

Black Knight Financial Services, Inc. has released an updated assessment of the potential mortgage-related damage from Hurricane Harvey, finding that at least 300,000 borrowers may become delinquent on their loans and 160,000 may become seriously delinquent (more than 90 days past due).

The FEMA-designated disaster area affected by Harvey is home to 1.18 million mortgaged properties. Black Knight Data & Analytics Executive Vice President Ben Graboske discussed the company’s findings in greater detail.

Find out what Graboske had to say, comparing Harvey to the aftereffects of Hurricane Katrina.

The U.S. District Court for the Northern District of California issued a $7.93 million trial verdict in the Consumer Financial Protection Bureau’s (CFPB) favor against Nationwide Biweekly Administration Inc. The CFPB had accused Nationwide of deceptive marketing practices regarding its payment program.

The CFPB had requested $73.9 million in restitution. However, U.S. District Judge Richard Seeborg declined, stating that the CFPB had “proved that defendants engaged in the type of fraud commonly connoted by the well-worn phrase ‘snake oil salesmen.’ ”

The National Association of Realtors has released its quarterly commercial real estate forecast, finding that commercial real estate price growth in large markets is expected to flatten over the next year, but strong leasing demand and investor appetite in smaller markets should keep the sector on solid ground.

Chief Economist Lawrence Yun said that although inventory shortages are driving prices higher in most markets, shrinking cap rates and the higher interest rate environment are expected to lead to a plateau in price growth over the next year.

The Financial Institutions and Consumer Credit Subcommittee heard testimony regarding the TRID Improvement Act of 2017, a bill introduced by Rep. French Hill (R-Ark.) that would amend RESPA and the Truth in Lending Act to expand the period where a creditor is allowed to cure a good-faith violation on a Loan Estimate or Closing Disclosure from 60 to 210 days after consummation.

During the question and answer portion of the hearing, Rep. Keith Ellison (D-Minn.) expressed concerns about the expanded period, asserting that it would create less incentive for lenders to correct mistakes quickly.

Find out why Hill proposed to expand the timeframe from two to seven months.

The National Flood Insurance Program has been extended by three months as part of a $15 billion disaster relief package signed by President Donald Trump. Although the National Association of Realtors called the extension a “must-do item,” not everyone was onboard with the package itself.

Texas Republican Rep. Jeb Hensarling, who is also the Chairman of the House Financial Services Committee, voted against the package.

Ocwen Financial Corp. has agreed to pay a $1 million penalty for failing to meet requirements set out under a February 2014 consent judgment entered by the U.S. District Court for the District of Columbia.

The consent judgment resolved claims that Ocwen engaged in unlawful conduct in the servicing of residential mortgage loans and to remediate harms allegedly caused by such conduct.

A monitoring committee issued a motion to enforce the judgment after finding that Ocwen exceeded certain threshold error rates.

A coalition of housing groups has called for the Senate to vote of Pam Patenaude’s nomination for Deputy Secretary for the Department of Housing and Urban Development. Patenaude previously was considered for secretary.

Patenaude, who currently serves as president of the J. Ronald Terwilliger Foundation for Housing America’s Families, served as HUD assistant secretary for community planning and development under President George W. Bush.

ReverseVision reported a record number of newly licensed lenders entering the Home Equity Conversion Mortgage (HECM) market in 2017, according to data from its ReverseVision Exchange loan origination system.

Over the same time period, ReverseVision saw an average of three new mortgage bankers begin offering HECM loans each day.

Read on for more details and what a STRATMOR Group senior partner says is behind the increased activity so far this year.

A report has been issued regarding discrimination within the rental housing market against potential renters with mental disabilities. The report – “Rental Housing Discrimination on the Basis of Mental Disabilities: Results of Pilot Testing” – is part of a new pilot study by the Department of Housing and Urban Development.

It was found that when compared with people without mental disabilities, people living with mental disabilities receive fewer responses to their rental inquiries, are informed of fewer available units and are less likely to be invited to contact the housing provider.

Find out more about the study’s results and what the authors recommended for future action.

The National Association of Realtors has released an issue brief advocating for the passage of the 21st Century Flood Reform Act (H.R. 2874), a bill that would reauthorize the National Flood Insurance Program for 5 years while also making “numerous and significant improvements to current law.”

The Consumer Financial Protection Bureau has issued a detailed summary of the changes and clarifications made from the finalized amendments to the TILA-RESPA Integrated Disclosure (TRID) rule.

The summary discusses the optional compliance period that was made available for the TRID amendments, exemptions for housing assistance loans, good-faith requirements, simultaneous subordinate lien loans, and more.

Read on for details of the summary and the highlights of changes you need to know.

The Mortgage Bankers Association (MBA) has reported that mortgage applications (the Market Composite Index) increased 3.3 percent from one week earlier, according to its Weekly Mortgage Applications Survey for the week ending Sept. 1.

On an unadjusted basis, the Index increased 2 percent compared with the previous week. The Refinance Index increased 5 percent from the previous week. The seasonally adjusted Purchase Index increased 1 percent from one week earlier. The unadjusted Purchase Index decreased 1 percent compared with the previous week and was 5 percent higher than the same week one year ago.

PHH Corp. and Realogy agreed to a settlement in the U.S. District Court for the Central District of California on Aug. 25.

Under the settlement, the companies have agreed to pay $17 million to end a putative class action alleging a kickback scheme for unlawful referrals of title services to Title Resource Group, a subsidiary of Realogy.

Just days after the Consumer Financial Protection Bureau issued a report warning senior borrowers about the risks of taking out reverse mortgages to delay collecting Social Security, the Department of Housing and Urban Development announced that it was making changes to the Federal Housing Administration’s Home Equity Conversion Mortgage (HECM) program.

Want to ensure that your organization hires and retains the best talent? In its latest Insights Report, STRATMOR Group includes select findings from its recent Compensation Connection survey, which examined the amount and types of paid time off (PTO) offered by banks and independent mortgage companies, as well as contributions to employee 401k plans.

In its 2017 Commercial Member Profile, the National Association of Realtors found that there was an 11 percent increase in commercial member income and a 19 percent increase in sales transaction volume.

President William E. Brown called “a stronger commercial market is a good indicator of a growing economy.”

The Consumer Financial Protection Bureau has issued a statement advising supervised entities that the bureau is encouraging entities impacted by Hurricane Harvey to “make use of existing regulatory flexibility where doing so would benefit consumers affected by this major disaster.”

The threat of class action lawsuits had been looming over the settlement services industry long before the Consumer Financial Protection Bureau released its finalized arbitration rule banning class-action waivers. Why are transactions covered by RESPA so susceptible to class actions? What do certain prominent cases teach us? More importantly, what are some underused defenses to class actions? Get these answers from Hahn Loeser partners Derek Diaz, Erica Calderas and Dennis Rose.

The U.S. District Court for the Southern District of Ohio, Western Division, has granted a motion for class certification in a class action lawsuit against Emery Federal Credit Union. The plaintiffs alleged that between 2009 and 2014, Genuine Title, LLC paid kickbacks to Emery employees in exchange for referrals for loan settlement services. Read on to see why the court certified the class.

American Pacific Mortgage Corp. has sued its insurer, Aspen Specialty Insurance Co., after it refused to cover the “substantial losses” American acquired after a hacker created a phony email imitating the company’s CEO. Read on for more details.

Speculation surrounding the political future of Consumer Financial Protection Bureau Director Richard Cordray has been ongoing for years. As August turns to September, however, that speculation has heightened. One observer says there are three signs that point to an imminent announcement. Read on for more about his view.

The U.S. District Court for the Northern District of Illinois has dismissed a purported class action lawsuit against Zillow. The lawsuit was brought by a group of property owners who alleged that the real estate website’s “Zestimate” feature mislead potential buyers about the value of properties listed for sale. Find out why the court sided with Zillow.

The Department of Housing and Urban Development has awarded $5 million to 25 local agencies in 15 states to address emergency, safety and security needs and fight crime in public housing properties. The award is funded through the Capital Fund Emergency Safety and Security Program. Read on for more details.

Butler Snow has been ranked as a Top 10 bond counsel firm in Thomson Reuters’ U.S. Municipals Review league tables for the first half of 2017. The firm ranked second in the private bond counsel category and ninth in negotiated bond offerings.

Butler Snow has been named a Leading Core firm for the pharmaceuticals industry in the BTI Power Rankings 2017: The Law Firms with the Best Client Relationships in 18 Industries list. The ranking places the firm in the top 5 percent of all law firms with regard to client relations within the pharmaceutical and medical device industry.

Dive into the world of RESPA with enforcement expert Phil Schulman. Learn about co-marketing activities following the CFPB decision to close its investigation of Zillow, complying in a post-PHH world, and what enforcement looks like with new leadership at the CFPB.

12 USC Section 2605 or Section 6 is titled Servicing of mortgage loans and administration of escrow accounts. It pertains to qualified written requests, notices of transfer of servicing and the administration of escrow accounts.

An arrangement that involves a person who is in a position to refer business as part of a real estate settlement service and who has an interest in a settlement services provider.

In the arrangement, the person, who has either an affiliate relationship with or a direct or beneficial ownership interest of more than one percent in a settlement services provider, directly or indirectly refers business to that provider or influences a consumer to select that provider.

An arrangement that involves a person who is in a position to refer business as part of a real estate settlement service and who has an interest in a settlement services provider.

In the arrangement, the person, who has either an affiliate relationship with or a direct or beneficial ownership interest of more than one percent in a settlement services provider, directly or indirectly refers business to that provider or influences a consumer to select that provider.

A mortgage disclosure that lists all estimated charges and fees associated with your loan. In addition to fees and charges, it will list your loan amount, mortgage rate, loan term and estimated monthly payment. Your escrows due at closing for insurance and taxes will also be outlined. Mortgage lenders are legally required to provide a GFE within three days of receiving your application.

A mortgage disclosure that lists all estimated charges and fees associated with your loan. In addition to fees and charges, it will list your loan amount, mortgage rate, loan term and estimated monthly payment. Your escrows due at closing for insurance and taxes will also be outlined. Mortgage lenders are legally required to provide a GFE within three days of receiving your application.

Under RESPA Section 2605(e)(1)(B), a qualified written request is a written correspondence that includes: 1) the name and account of the borrower, or has enough information to allow the servicer identify that information; and 2) a statement of the reasons for the belief of the borrower that the account is in error or provides sufficient detail to the servicer regarding other information sought by the borrower.

A QWR cannot be written on a payment coupon or other payment medium supplied by the servicer.

Under RESPA Section 2605(e)(1)(B), a qualified written request is a written correspondence that includes: 1) the name and account of the borrower, or has enough information to allow the servicer identify that information; and 2) a statement of the reasons for the belief of the borrower that the account is in error or provides sufficient detail to the servicer regarding other information sought by the borrower.

A QWR cannot be written on a payment coupon or other payment medium supplied by the servicer.

Under Regulation X, required use means a situation in which a person must use a particular provider of a settlement service in order to have access to some distinct service or property, and the person will pay for the settlement service of the particular provider or will pay a charge attributable, in whole or in part, to the settlement service.

However, the offering of a package or (combination of settlement services) or the offering of discounts or rebates to consumers for the purchase of multiple settlement services does not constitute a required use. Any package or discount must be optional to the purchaser. The discount must be a true discount below the prices that are otherwise generally

12 USC Section 2607 or Section 8 is titled Prohibition against kickbacks and unearned fees. It prohibits fees or kickbacks for referrals. It also prohibits accepting a portion of fee except for services actually performed. Section 8 provides information on what payments are allowed under this section and the penalties for violations.

12 USC Section 2608 or Section 9 is titled Title companies; liability of seller. This section states that a seller cannot require, as a condition of selling the property, that title insurance be purchased by any particular title company. Section 9 states that a seller who violates this section is liable to the buyer for treble damages.

12 USC Section 2609 or Section 10 is titled Limitation on requirement of advance deposits in escrow accounts. It governs escrow accounts including notifications and statements to borrowers. Section 10 also sets out penalties for those who violate the section.

Under RESPA, settlement service includes any service provided in connection with a real estate settlement. The statute provides a list of services.

Under Regulation X, settlement service means any service provided in connection with a prospective or actual settlement. The regulation provides an extended list of services as compared to the statute.

RESPA Section 3 provides that a thing of value includes any payment, advance, funds, loan, service or other consideration

Regulation X says thing of value includes: monies, things, discounts, salaries, commissions, fees, duplicate payments of a charge, stock, dividends, distributions of partnership profits, franchise royalties, credits representing monies that may be paid at a future date, the opportunity to participate in a money-making program, retained or increased earnings, increased equity in a parent or subsidiary entity, special bank deposits or accounts, special or unusual banking terms, services of all types at special or free rates, sales or rentals at special prices or rates, lease or rental payments based in whole or in part on the amount of business referred, trips and payment of another person’s expenses or reduction in credit against an existing obligation.

A form used by a settlement or closing agent itemizing all charges imposed on a borrower and seller in a real estate transaction. This form represents the closing transaction and provides each party with a complete list of incoming and outgoing funds. RESPA requires the HUD-1 to be used as the standard real estate settlement form in all transactions in the U.S. involving federally related mortgage loans.